Saturday, December 25, 2010

I enjoyed the “original” with John Wayne. I just saw the remake with Jeff Bridges and was blown away!

I’ve always thought Bridges was a much better actor than he was ever given credit for and his Oscar wining performance in Crazy Heart proved it. Well he’s back and even better in True Grit.

Everything I’ve read about the move claims that it’s more true to the book. Not having read the book I can’t say. What I can say is that Bridges is terrific. Matt Damon shows a dimension that only The Departed tapped before. I expect him to show a much greater range of acting skill as he is tapped for more demanding parts. Newcomer Hailee Steinfeld is outstanding as Mattie and delivers a dimension to the character that was missing in the original movie version.

Put this on your “do not miss” list. Worth every penny of the admission!

Friday, December 17, 2010

I have been screaming that the loss of manufacturing in the US is not caused by the difference between profit an loss, it’s caused by the difference between profit and more profit. Finally an article in Fast Company supports my “gut check”. The following quote from the article illustrates my point quite well.

"The authors offer a scenario in which Apple suddenly decides not to pursue profit maximization, dumps the oft-criticized Foxconn, and decides to pursue a model of corporate responsibility and patriotic we're-in-it-togetherness. It's true that U.S. workers fetch about 10 times as much as Chinese workers, and the manufacturing costs would rise to $68 per phone from about $6.50 per phone. But if Apple sold the phones at an average of $500 (already the asking price for some models), they say, it would still clear a 50% profit margin."

Thank god someone a lot smarter than I am gathered the statistics to prove my pattern recognition opinion. I’ve been saying for years that the choices most companies are making to manufacture their products overseas are rarely about profit and loss, they are about percent of profit.

Now don’t get me wrong there is nothing wrong with making a profit or making as much profit as you can. What’s wrong is making that profit while killing your customer base!

When I lived in Seattle I watched a major company kill their customer base by off-shoring a lot of their production from small local vendors. Now the major customers for their products are American companies and the customers to those American companies are the American people. So, every job lost is a customer lost since without a well paying job, those Americans can’t afford to buy from that mega companies customers – the mega company looses sales since their direct customers don’t need to buy more.

Our current economic problems are completely driven by short-term thinking; buy focusing on profit rather than realizing that profit is a by-product of building a good product and supporting customer’s who buy your product. What I see from the bottom of the pile is tactical thinking.

The cure of course is to start thinking strategically. Start planning for a long run and not putting too much effort into next quarter’s stock price. Better to give up 10% profit this year or for the next two years but to ensure not only future profits but also existence for the next 10 years.

Back when I was in the Army I was taught that the troops do what the commander checks. In this case, the moneymen are the commanders and they are checking the tactical stuff (profit this quarter or this year) and at their level they should be checking the strategic (profit for the year after next and the next 5 years).

Friday, December 3, 2010

I just found this article in today’s Time magazine online and one of the key elements jumped out at me. The article begins; “The closure of Torino's Lingotto assembly plant in 1982 was a body blow for the Italian car capital”.

And goes on to describe how Torino overcame the effects of a 100,000 person layoff when the plant closed. To quote further "Today the Lingotto plant stands once again as the symbol of the city. Only now the old factory serves as a testimonial that there can be life after the auto industry. Redesigned in the 1990s by Italian architect Renzo Piano, it forms the hub of a revitalized commercial district."

The unanswered question is “What did all those people do for that 8 years while the city got it’s rebranding off the ground?” While the human impact of the 8 lean years shouldn’t deter anyone from beginning to make these kinds of changes any plan must include the human element and that is not described in this article.

It should be obvious to the most casual observers that just focusing on companies and bringing in “trained” workers leaves your citizens to take the bottom end jobs at low wages and benefits. Left to their own devices, most people can’t afford either the time or tuition to go back to school full time. Part time is demanding and disruptive of family life and finances since the available jobs rarely pay well enough to maintain the family life style AND pay schooling costs.

Leaving this out makes describing the revitalization process much easier but is grossly misleading of the complexities that the agencies face. Without a well prepared work force to match the business friendly climate the article describes, those displaced workers will just fall by the wayside and you develop am unemployed underclass and we all know how well that has worked for may big American cities for the past hundred years.